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Wood: Iowa’s Secretary of State is part of our entrepreneurial ecosystem

Last week I sat in on a meeting with Paul Pate, Iowa’s two-time Secretary of State, held at the Greater Des Moines Partnership. The meeting was one of several listening sessions that the Secretary has held across Iowa in recent months to find ways to improve our local business climate.

Among other duties, the Secretary of State is the office in Iowa responsible for many of the official connections between the state government and our business community. Some of their functions include receiving corporate filings, maintaining the business registry, issuing Certificates of Good Standing and certifying Notaries Public.

That makes this office an integral—though often overlooked in this context—part of our state’s entrepreneurial ecosystem.

Most attendees at the meeting were attorneys, accountants or others that directly interface with the Secretary of State’s office regularly. I was there as someone primarily interested in the data on our business community that exists with their databases and what we can learn from it.

I’m really interested in finding out whether all of the work we’ve been doing collectively in the Iowa entrepreneurial ecosystem is having any effect. I’d like to know if we’re truly accelerating the growth of new and sustainable businesses in our state. How many new businesses are created in the state each year (Pate said 20,000 were registered in 2016 more than double where we were in his first term in the late 1990s) and how many dissolve? How many firms exist that are under two years old? The Kauffman Foundation has found that all net new job creation comes from these young firms. Of course, I’d also like to see how these metrics have changed over time.

Surprisingly, at least to me, there’s not anyone in Iowa publishing this data. We know it exists in the Secretary of State’s databases but their systems are so antiquated they’re not able to efficiently retrieve or share it.

While access to that data is important to me and would certainly be useful in examining and refining our efforts in growing Iowa’s entrepreneurial ecosystem, it’s just a small part of why the Secretary of State’s office wants to upgrade their systems.

Updating the technology that their office runs on was the primary theme of the listening session as the Secretary spoke mostly about how the current system slows business filings and holds up the day-to-day operations of those seeking to do business with his office.

An adjacent theme was building support for the new fees his office has been authorized by the legislature to charge in order to cover the costs of the new technology.

Secretary Pate, a Republican, estimates needing an additional $7 million to make this upgrade and expects to fund it over 4-5 years. Despite that funding mechanism, it might be a heavy lift in the midst of an (estimated) $300 million budget shortfall.

Geoff Wood is the co-founder of Clay & Milk and the founder of Gravitate, a coworking community and entrepreneurial support organization in Des Moines. He’s been helping tell the story of the Iowa startup community since 2009.

3 Comments

  • Tej Dhawan
    Posted July 6, 2017 at 1:42 pm

    Ha! Reminds me of a similar meeting Christian and I had with Pate’s predecessor, Matt Schultz, in his office a few years ago. We were seeking some of the info to help push the OpenIowa weekend project forward and the challenges then were as you document now.

  • Geoff Wood
    Post Author
    Geoff Wood
    Posted July 6, 2017 at 2:54 pm

    Nice! We were chatting in the back of the room after the meeting and OpenIowa came up—time to try that again? Also, Pate did say that their systems haven’t been updated in 20 years, so its probably the exact same challenge.

  • Scott Hoekman
    Posted July 7, 2017 at 12:47 pm

    It is hard to understand how a filing system would cost $7M to implement. Hello: workiva.com (based in Ames, already built out, and used by hundreds of companies filing with many different government entities).

Comments are closed.

Wood: Iowa's Secretary of State is part of our entrepreneurial ecosystem | Clay & Milk
A central Iowa ag-tech accelerator has secured more backers and finally has a name. The Greater Des Moines Partnership first announced the accelerator last year, naming four initial investors. On Monday, the Partnership said the program will be called the "Iowa AgriTech Accelerator" and named three new investors. The new investors include Grinnell Mutual, Kent Corp. and Sukup Manufacturing, all Iowa companies. They join investors Deere & Co., Peoples Co., Farmers Mutual Hail Insurance Co. and DuPont Pioneer. Each investor has agreed to put up $100,000 for the first year of the accelerator. Startups entering the program will receive $40,000 in seed funding in exchange for 6 percent equity. Tej Dhawan, an angel investor and local startup mentor, is serving as interim director until the AgriTech Accelerator names a permanent leader. Dhawan held a similar role with the GIA before Brian Hemesath was named as managing director. As interim director, Dhawan said his main job includes hiring the accelerator's executive director, establishing a business structure and initial recruiting for the first cohort. The accelerator will place few filters, such as location and product, on the applicant pool, Dhawan said. "When you’re seeking innovation, innovation can come from every corner of the world so why restrict ourselves," he said. One area the the AgriTech Accelerator won't recruit from is biotech. For its first cohort, the AgriTech Accelerator will work out of the GIA's space in Des Moines' East Village, Dhawan said. A future, permanent home is still to be decided. The accelerator's program will host startups from mid-July through mid-October, ending with an event connected to the annual World Food Prize. The GIA, which the AgriTech Accelerator is based on, also ends with presentations at an industry event. The accelerator has also started lining up a mentor pool. The Iowa Corn Growers Association, Iowa Soybean Association and the Iowa Pork Producers Association have agreed to provide mentors, as has Iowa State University. While the AgriTech Accelerator is loosely based off of the GIA, it will differ in its business structure, Dhawan said. The GIA runs through a for-profit model for both operations and its investment fund. The AgriTech Accelerator will have a nonprofit model for its operations and a for-profit setup for its fund. Dhawan said the nonprofit model is being used so the accelerator can better work with other nonprofit partners, such as trade associations. "These are all organizations that are nonprofits and can be amazing stakeholders without ever having to be investors in the accelerator," he said. "It becomes easier to work with trade associations in their nonprofit role when we are also a nonprofit." When it's up and running, the AgriTech Accelerator would be one of a handful of ag-focused startup development programs in Iowa. Others include the Ag Startup Engine out of Iowa State University and the Rural Ventures Alliance from Iowa MicroLoan. Matthew Patane is the managing editor and co-founder of Clay & Milk. Send him an email at mpatane@clayandmilk.com.
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